TaxTMI 
TaxTMI 
1998 (1) TMI 290
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....b-heading 3920.31 of Central Excise Tariff Act 1985, according to the Department, whose case is that the appellant's premises were searched by the Central Excise officers following information that they had adopted certain methods of evading Central Excise duty by declaring in their price lists submitted to the Department a much lower price for their goods wherein the expenses incurred towards marketing and sales promotion were not included which should form part of the assessable value. But these expenses were passed on off loaded to their associate firms who are the other appellants Ram Laminates Bombay, and Poona, Ram Metal Industrial and another service agent appellant Maharashtra Laminates, Bombay. These firms raised separate bills for....
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....ing partners and directors of appellant firms and service agents show cause notice was issued on 27-10-1988 to the appellants proposing to recover differential duty by enhancing the assessable value loading it with the expenses borne by the selling agents and paid back to the appellants and also proposing penalty on the appellant Ram Decorative Laminates under Rule 173Q Central Excise Rules and proposing penalty on the other appellants herein under Rule 209A alleging that they had dealt with excisable goods which were undervalued with an intention to evade payment of duty knowingly. These appellants included the firms Ram Metal Industries Bombay, Ram Laminates Bombay and Poona, Shri R.R. Jhunjhunwala, Chairman and Managing Director of appel....
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....emand. They rely upon their letter dated 8-12-1986 whereby they informed the Department that as per the practice in the trade they had appointed agents to procure business from dealers and distributors and that these agents charge separately to the dealers for the services rendered to them and such charges included insurance, octroi and transport and that the agents paid the appellants towards the expenses incurred towards insurance, transport, handling charges, etc. In that letter they further stated that recently Excise authorities in the case of some of the units in the trade have sought to include part of the realisation by the agents in the assessable value of the product and in that context the appellants wrote requesting the Departme....
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....rds the service charges the Collector's finding is based upon the judgment of the Supreme Court in the case of Coromandel Fertilizer - 1984 (17) E.L.T. 607, whereby Supreme Court has disallowed agency commission given to a selling agent for services rendered by him as a deduction from the assessable value. Collector's finding is hence upheld. 8. It is also found that the Collector has held that only deduction of actual amounts of transportation costs and insurance charges are deductible under Section 4 of the Act. However, this view is no more good law and stands settled against the Department by the Supreme Court judgment reported in 1997 (94) E.L.T. 13, Baroda Electric Meters v. Collector cited and relied upon by the learned Consu....
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....of a part of the profit as excisable duty payable for the goods. 10. It has also been urged that the classification of decorative laminates manufactured by the appellants should be under Tariff Item 68 CET covering goods not elsewhere specified in the tariff, and not as plastic sheets under Item 15A(2) CET for the period prior to March, 1986 in view of the Supreme Court judgment in the case of Collector v. Bakelite Hylam - 1997 (91) E.L.T. 13 holding that laminated sheets being composite material are not classifiable under Item 15A(2) but under Item 68 CET. Before the Collector the same argument had been put forth based on Tribunal decision to the same effect in C.C.E. v. Melamine Fibre Board. Ld. DR, had repelled this contention be....